Worried about your investments heading downhill?

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Worried about your investments heading downhill?

• ltAdvisers Namegt

ltAdviser namegt is an Authorised Representative of
RI Advice Group Pty Ltd
2
Worried about your investments heading downhill?

• ltAdvisers Namegt

ltAdviser namegt is an Authorised Representative of
RI Advice Group Pty Ltd
3
Worried about your investments heading downhill?

• ltAdvisers Namegt

ltAdviser namegt is an Authorised Representative of
RI Advice Group Pty Ltd
4
Worried about your investments heading downhill?

• ltAdvisers Namegt

My Name Financial
ltAdviser namegt is an Authorised Representative of
RI Advice Group Pty Ltd
5
Worried about your investments heading downhill?

• ltAdvisers Namegt

JV logo
ltAdviser namegt is an Authorised Representative of
RI Advice Group Pty Ltd
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Disclaimer

• Important Notice

RI Advice Group Pty Ltd, ABN 23 001 774 125,
holds Australian Financial Services Licence
Number 238429 and is licensed to provide
financial product advice and deal in financial
products such as deposit and payment products,
derivatives, life products, managed investment
schemes including investor directed portfolio
services, securities, superannuation, Retirement
Savings Accounts. The information presented in
this seminar is of a general nature only and
neither represents nor is intended to be specific
advice on any particular matter. RI Advice Group
strongly suggests that no person should act
specifically on the basis of the information
contained herein but should obtain appropriate
professional advice based on their own
circumstances.
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Contents

• 1. Timing the market
• 2. Recovery from market crisis
• 3. Short term volatility vs long term consistency
• 4. Benefits of diversification asset class
  returns
• 5. Financial planning strategies

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1. Timing the market

• Time In Versus Timing
• Missing the best trading days can significantly
  affect returns.
• All Ordinaries Accumulation Index 31/12/1998 to
  31/12/2008

Source Iress
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2. Recovery from market crises
Source Iress
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2. Recovery from market crises
Source Iress
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2. Recovery from market crises
Source Iress
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3. Short term volatility vs long term consistency
Australian Equities
Volatility of shares - Australian market
Rolling periods from 31 December 1985 - 31
December 2008
1 year 10 years
Source SP/ASX300 Accumulation Index, Iress
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3. Short term volatility vs long term consistency
US Equities
Volatility of shares - US market Rolling
periods from 31 December 1985 - 31 December 2008
1 year 10 years
Source MSCI World Accumulation Index, Iress
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Diversification can create more consistent returns
Australian shares Global shares Australian property securities Australian fixed interest Cash
1989 17.4 26.0 2.3 14.9 18.5
1990 -17.5 -15.1 8.7 19.0 16.1
1991 34.2 20.2 20.1 24.7 11.2
1992 -2.8 4.5 7.0 10.4 6.9
1993 40.5 24.4 30.1 16.3 5.4
1994 -8.8 -8.1 -5.6 -4.7 5.4
1995 20.7 25.9 12.7 18.6 8.0
1996 14.3 6.3 14.5 11.9 7.6
1997 11.4 41.1 20.3 12.2 5.6
1998 8.5 32.1 18.0 9.5 5.1
1999 19.3 17.1 -5.0 -1.2 5.0
2000 6.2 2.2 17.8 12.1 6.3
2001 10.5 -9.7 14.6 5.4 5.2
2002 -8.6 -27.2 11.8 8.8 4.8
2003 15.0 -0.5 8.8 3.0 4.9
2004 27.9 10.3 32.0 7.0 5.6
2005 22.5 17.0 12.5 5.8 5.7
2006 24.5 11.7 34.0 3.1 6.0
2007 16.2 -2.1 -8.4 3.5 6.7
2008 -38.9 -25.3 -54.0 14.9 7.6
Average 8.9 5.9 7.5 9.5 7.3
Timeframe 31/12/89 - 31/12/2008 Data Australian
shares - SP/ASX 300 Accum. Index, International
Shares - MSCI World (ex Aus) in A, Listed
Property Trusts - SP/ASX 200 Prop Trust,
Australian Fixed Interest Commonwealth Bank Bond
Index (Pre Sept 89) / UBSA Composite Bond All
Maturities Index (Post Sept 89), Cash 11am Cash
Rate (Pre Apr 87) / UBSA Bank Bill Index (Post
Apr 87) Source RBA, IRESS
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4. Asset class returns - Historical
Growth of 10 000 over 20 years
Australian shares 54,970
Global shares 31,620
Australian property securities 42,111
Australian fixed interest 61,917
Cash 41,151
Timeframe 31/12/88 - 31/12/2008 Data Australian
shares - SP/ASX 300 Accum. Index, International
Shares - MSCI World (ex Aus) in A, Listed
Property Trusts - SP/ASX 200 Prop Trust,
Australian Fixed Interest Commonwealth Bank Bond
Index (Pre Sept 89) / UBSA Composite Bond All
Maturities Index (Post Sept 89), Cash 11am Cash
Rate (Pre Apr 87) / UBSA Bank Bill Index (Post
Apr 87) Source RBA, IRESS
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5. Financial planning strategies

• Given the recent market volatility, the
  following are some possible options for further
  discussion
• Re-visit your Investor profile
• Risk Profile
• Re-balance your portfolio
• Growth vs Defensive to Strategic Asset Allocation
• Set up a Regular Investment Plan
• Dollar Cost Averaging
• Pension Drawdowns
• Use of defensive asset classes for funding
  pension income

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Thank you